Around this time last year, after debuting a number of “smart” shoes, such as its re-introduced self-lacing sneakers and ones that can be tightened or loosened via a smart phone, Nike revealed that it was working on a clever new branding scheme in which its arsenal of futuristic offerings would not be called footwear but “footware.” This revelation came when Nike filed a trademark application with the U.S. Patent and Trademark Office (“USPTO”) in late March 2019, seeking a registration for the term for use in connection with various sneaker-specific hardware and software products and services.
While Nike had not yet begun using the “footware” mark as of the time it filed its application (and still has not), it filed on an intent-to-use basis, meaning that it has “a good faith intention to” begin using it in the not too distant future in a number of classes of goods/services, namely, “electronic devices and downloadable computer software that allow users to remotely interact with other smart devices for monitoring and controlling automated systems,” among other things.
By way of the trademark, which combines “footwear” and “software” (and maybe also “hardware,” too), Nike is seemingly aiming to brand a looming venture that marries its world-famous footwear with technological components.
Almost from the outset, the Beaverton, Oregon-based sportwear giant’s trademark has been subject to pushback. In a preliminary response to its application, an examining attorney for the USPTO asked Nike to “explain whether the wording in the mark ‘Footware’ has any significance in the software, hardware, or telecommunications trade or industry or as applied to [Nike’s] goods and/or services, or if such wording is a “term of art” within [Nike’s] industry.” That question is particularly relevant because if the term “footware” were, in fact, a “term of art” within the footwear or sportswear industries, that might stand in the way of the word acting as an indicator of a single source in the same way as the Nike name and its instantly-recognizable swoosh logo. In other words, it might prevent the term from functioning as a trademark.
Nike’s counsel responded to the USPTO’s Office Action, confirming that the “footware” does not have “significance nor is it a term of art in the relevant trade or industry.”
With preliminary issue out of the way and given that Nike is not seeking to use the “footware” mark on shoes (i.e., footwear), which would have inevitably led to a much more significant back-and-forth between the USPTO and Nike’s legal team, the application moved ahead in the pre-registration process.
However, a letter that the examining attorney added to Nike’s application documents in July, just three months after the nearly 60 year sporting goods behemoth filed its application, proved that Nike was not out of the woods in the registration process. As it turns out, a third-party had sent a “letter of protest” to the USPTO Commissioner, taking issue with Nike’s attempt to claim exclusive rights and a registration in the word “footware” for use in connection with the various goods/services at issue.
In the early-stage challenge to the Nike application (in which a party can point out potential issues in connection with a pending application before it reaches the opposition stage), the third-party at play asserted – and provided evidence – that “footware” is a “merely descriptive” term for technology-driven footwear designs (and not an indicator of a single source), and thus, is not eligible for registration by anyone, especially Nike.
The third-party was Puma, and the evidence it provided to the USPTO in its letter consisted of examples of both its and Nike’s tech-centric efforts – from Nike’s self-tightening “smart shoe” to Puma’s RS-Computer shoe.
The USPTO’s examining attorney revealed in a filing days later that he had reviewed the evidence provided with the protest letter, and yet, Nike’s application for the “footware” mark proceeded in the pre-registration process and was published for opposition, a routine practice that provides any party that believes it may be damaged by registration of the pending trademark with the opportunity to file either an opposition to the registration laying out the reasons why the trademark should not be registered or a request to extend the amount of time it has to file a formal notice of opposition.
In February, Puma filed a request for a 90 day extension with the Trademark Trial and Appeal Board (“TTAB”), asserting that it needed “additional time to investigate the claim” and “to confer with counsel.” The sportswear company has until May 20 to either seek an additional extension or to file its opposition, or to abandon its ability to prevent the mark from potentially being registered.
To date, Puma has not filed anything substantive with the TTAB.
A Lawsuit-Ridden Market
The budding battle between Nike and Puma is one the latest examples of legal squabbles that pit sportswear leaders against one another in the $58 billion-plus sneaker market, and in fact, it comes just months after Nike and Puma seemingly settled the unrelated design patent infringement lawsuit that Nike filed in 2018, in which it accused Puma of “forgoing independent innovation and instead, using Nike’s technologies without permission.”
While the fashion industry sees its fair share of lawsuits, the footwear and sportswear markets tend to be particularly rife with litigation and other legal conflicts (oftentimes much more so than its fashion counterparts) for a number of reasons. High on that list is the fact that footwear giants like Nike and adidas, among others, routinely invest large sums and years of time in the research and development that goes into the proprietary technologies boasted by their offerings – whether that be Nike’s Flyknit technology, for example, or adidas’ Boost foam tech.
This level of investment gives rise to incentives for brands to “defend [those investments] in innovation” (and thereby, recoup their R&D expenditures), as Nike put it in the aforementioned design patent infringement lawsuit that it filed against Puma. It also motivates brands “to protect [their] technologies.” (Aside for brands’ very-valuable trademarks and luxury brands’ staple items, similar incentives arguably do not exist in the fast-paced and highly-seasonal fashion industry, which runs on a calendar that calls for the regular introduction of new products that have short shelf lives).
In terms of protection, no shortage of the footwear products being sold by the likes of the industry’s biggest names are the subject of a mini-arsenal of rights. Design patents, for instance, protect the ornamental design of a functional item, such as a shoe, while a utility patent provides protection for the creation of a new or improved product, process, or machine, including the process for assembling elements of a technically-advanced sneaker.
Patents – and a lot of them (Nike, for instance, secured 867 patents in 2018, alone, and even more, 1,212, the year before that) – give brands like Nike and adidas grounds to take legal action when their products or even just individual, protected elements of the products are copied. This differs quite a bit from the average fashion industry garment design, which largely lacks copyright protection and because it is seasonal in nature, the expense and pendency associated with design patents does not necessarily make such protection a worthwhile investment.
Operating more like staple fashion industry products, which ate routinely protected, sportswear brands’ footwear tends to sell for longer periods of time and in significant quantities, which leads brands to build a collection of protections around each of their designs and the various branding and other trademark elements that come with them. In other words, there tends to be many more protections at play when it comes to a sneaker than even your average “it” bag and certainly more than even some of the industry’s most hot-selling seasonal garments.
Finally, the resources of companies like Nike – which generated $39.1 billion in revenue in 2019 and maintains a market cap of more than $110 billion – and adidas – which brought in $26.5 billion in sales last year – mean that they have sizable litigation budgets and swamps of in-house and outside lawyers, thereby, making their efforts to enforce their rights not only mighty but also downright common practice.